Emirates posts robust half-year results

By Dino D'Amore
November 12, 2013 18:14

The Emirates Group half-year revenues reached AED 42.3 billion (US$ 11.5 billion) for the first six months of its current fiscal year ending 30 September 2013, up 13% from AED 37.5 billion (US$ 10.2 billion) at 30 September 2012.

Net profit for the Group rose to AED 2.2 billion (US$ 600 million) an increase of 4% over the last year’s results. The Group’s cash position on 30 September 2013 was at AED 18.2 billion (US$ 4.9 billion), compared to AED 27.0 billion (US$ 7.3 billion) as at 31 March 2013. This is after a AED 1.8 billion bond repayment which matured in July 2013, a AED 367 million first instalment payment on a USD 1 billion Sukuk, and a AED 7 billion injection back into the business to fund new aircraft, engines, spares and other projects across the Group.

“The global business environment continues to be challenging. We have stayed agile even as we grow, and this ability to adapt and act quickly has been key to our success. Our investments in the infrastructure of both Emirates and dnata continue to pay off and while we keep a close watch on managing our immediate business targets, we never lose sight of our long-term goals, and that is why we continue to invest to build the business,” said His Highness (HH) Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group.

During the first six months of the fiscal year Emirates received 10 wide-body aircraft – six A380s, three 777s and one 777 freighter, with 15 more new aircraft scheduled to be delivered before the end of the financial year (31 March 2014). Emirates also invested in its network by launching services to two new destinations – Haneda and Stockholm, bringing the total count of new routes launched in the past 12 months to seven including Adelaide, Lyon, Phuket, Warsaw and Algiers.

Despite the fundamental challenges of high fuel prices, a still-recovering global economy, and a strong performance of the US dollar against other major currencies impacting revenues, Emirates continues to make a profit. In the first half of the 2013-14 fiscal year, Emirates net profit is AED 1.7 billion (US$ 475 million), up 2% from the same period last year.

“Emirates’ half-year scorecard shows a steady demand for our products and services. Our capacity and route growth continue to match and meet passenger demand. High fuel prices, accounting for 39% of our expenditures, and the unfavourable currency exchange environment continue to eat into our profits. However, we remain steadfast in our vision to be the airline of choice for international air services, and we will invest in our people and our infrastructure, and work closely with our partners to bring this to fruition,” said HH Sheikh Ahmed.

In the first-half of its financial year 2013-14, Emirates posted strong business growth, both in terms of capacity on offer and traffic carried. This performance has been in sharp contrast to the current trend seen across the aviation industry. Capacity measured in Available Seat Kilometres (ASKM), grew by 16.9%, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was up 16.1% with Passenger Seat Factor sustained at a high level, averaging 79.2%, slightly below last year’s 79.7%. Emirates carried 21.5 million passengers since 1 April 2013, up 15% from the same period last year. The volume of cargo uplifted was up by 5.2%, a remarkable growth and performance against the market trend.

dnata continues its strong performance, building on the success of its investments in international business growth and infrastructure which now span 38 countries. dnata’s revenue including other operating income is AED 3.7 billion (US$ 1 billion), 18% higher compared to AED 3.2 billion (US$ 864 million) last year. Overall profit for dnata rose strongly by 13% to AED 458 million (US$ 125 million).

dnata’s airport operations was the largest contributor to revenues with AED 1.4 billion (US$ 375 million), a 16% increase compared to AED 1.2 billion (US$ 324 million) in the same period last year. Across its operations, the number of aircraft handled by dnata rose to 141,845, an increase of 9%.

dnata’s in-flight catering operation, recorded strong growth and contributed AED 891 million (US$ 243 million) of its total revenue, up 39%. The number of meals uplifted was at 22.4 million meals for the first half of the fiscal year, up a massive 81% compared to last year. These increases mainly reflect its acquisition of Servair in Italy in June 2013. Revenue from dnata’s Travel Services operation contributed AED 303 million (US$ 83 million), up 16% from the same period last year.

dnata’s cargo handling division also witnessed upward growth with revenues increasing by 4% to AED 546 million (US$ 149 million) on account of increased tonnage mainly for dnata’s UK operation and in Switzerland which rose in total by 2% to 809,236 tonnes.